The method used to decide whether or not the NHS will fund a drug is should be scrapped, according to a new study.

The formula used by the National Institute for Health and Clinical Excellence (NICE) assesses a drug by looking at how much a year's worth of treatment costs compared with the benefits the patient gains in life expectancy and improved health.

But researchers, funded by the European Commission, found the system currently used by the UK drugs watchdog is deeply 'flawed'.

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The method is known as quality-adjusted life years (QALY) and has been used as a template by other countries such as Canada.

However, the decisions are often controversial as they affect whether patients suffering illnesses such as cancer can receive potentially life-altering treatments.

NICE generally turns down treatments that cost more than £20,000 per QUALY as not cost-effective, which often rules out new revolutionary drugs.

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Now a team of researchers, led by French doctor Ariel Beresniak, have called for it to be scrapped as it produces the 'wrong results.'

'This isn't a scientific way to classify and prioritise the drugs - mathematically, it's flawed,' Dr Beresniak told the BBC.

'NICE has made negative recommendations about many major innovative drugs, based only on arbitrary incremental cost per QALY.'

The researchers added that the method doesn't reflect different views on illness and disability.

Dr Beresniak believes the system used by NICE to decide whether to fund drugs produces the 'wrong results'

They found these could vary widely after surveying 1,300 European respondents, including 301 in the UK.

For instance while 71 per cent of respondents would prefer to live 15 years in a wheelchair than die after ten or five years in a wheelchair, the remaining 29 per cent would rather die earlier.

The team suggested that another approach should be considered, perhaps that looked at how many relapses a drug might prevent or how many cases of remission it could provide.

The findings were welcomed by a number of charities.

James Whale, Chairman of The James Whale Fund For Kidney Cancer said: 'This new research funded by the European Commission underlines what we have been saying about the NICE system of cost of ‘treatment against effect on health and life expectancy’ all along, it is simply incorrect. NICE have to scrap these guidelines now and start giving hope to all cancer patients and put a stop to their ‘flawed’ methodology without fail.'

However, a number of British experts have defended the system, saying difficult decisions needed to be made working with a limited budget.

Prof David Spiegelhalter, Winton Professor of The Public Understanding of Risk, University of Cambridge, said: 'These type of criticisms are not new and do not invalidate what is done by NICE.

'Of course the QALY approach is not perfect, but some mechanism is needed to provide consistent comparisons across different medical interventions, based on aggregate benefit and cost. Otherwise the money could go to those with the most appealing emotional argument.'

Prof John Cairns, from the London School of Hygiene and Tropical Medicine and a member of the NICE Appraisal Committee for 10 years, said: 'We
need to be able to compare what we gain by spending in one area with what we
lose by not spending in another area.

'This new project’s suggested
approach of using measures of outcome specific to particular diseases will not
allow us to do that.

'QALYs are certainly not
perfect and we should be looking for better ways of informing decision making
but getting rid of an imperfect system without replacing it with a better one
is not the way forward.'

A NICE spokesperson said: 'When we want to find out whether a new treatment provides more for patients than current practice, and whether any improvement in quality or length of life justifies the price the NHS is asked to pay for it, we need to use a measure that can be applied fairly across all diseases and conditions. The QALY is the best measure anyone has yet devised to enable us to do this.

'Economists will argue about the precision of the QALY methods and it’s not perfect. But it’s based on solid research and uses a way of measuring how quality of life changes when using different treatments, which is the best we have available.

'It’s developing and improving all the time and the criticisms in this, rather limited study haven’t shaken our confidence in its value to NICE in helping make decisions on the best way to use new and sometimes very expensive drugs and other health technologies.'